Julia may have missed the bus

By not challenging, Julia Gillard has chosen what appears to be the risk-free approach. Picture: Kym Smith

GILLARD'S gamble on a Labor victory won't necessarily pay dividends.

ALTHOUGH yesterday's Labor caucus meeting was uneventful, it will turn out to be memorable. Whatever happens at the next election, it was the most important caucus during Labor's term in office.

If the government goes on to win the election, it will be remembered as the moment when cooler heads prevailed and Labor held its nerve, stood by its damaged leader and allowed certainty at the top to help pull itself out of the quagmire it is in. The size of the victory will dictate how flowery Labor makes this tale.

However, if Labor loses the next election and this government becomes a oncer, the caucus meeting will be remembered as the moment when Labor MPs squibbed on their duty to themselves, and Julia Gillard cast herself as a wimp who might never become prime minister, as someone unwilling to strike even when it was in her and her party's best interests to do so.

Leadership tensions have built up in recent weeks on the back of poor opinion polls and poor decision-making. It started when Kevin Rudd backed down on the emissions trading scheme, his answer to the greatest moral challenge of our time. Since then the government has looked scratchy as it has tried to argue the case for its resource super-profits tax on the mining industry.

But too few Labor MPs had the stomach to tear down a first-term Prime Minister yesterday.

It would have been a remarkable move. Liberals will tell you how hard it is to challenge an incumbent leader: they never did it to John Howard, even though in his final year in power he was consistently behind in the polls.

But Labor has the reputation of being a more ruthless organisation, led by the ever-present NSW right faction, prepared to do whatever it takes to win elections and retain power.

And Rudd is a far less loved figure inside the Labor Party than Howard was inside the Liberal Party at the end of his prime ministership.

This week started with a Newspoll that put Labor in front by 52 per cent to 48 per cent on the two-party vote. Even though Labor hardheads don't pay attention to the two-party vote - they are interested only in the primary vote, which was a far more disastrous 35 per cent - Labor backbenchers were comforted by the result. It snuffed out any prospect of a challenge.

By the time the Newspoll targeting marginal seats came out on the morning of the caucus meeting, it was too late to marshal any kind of challenge, especially with Gillard showing no interest in moving.

The caucus meeting was therefore a tame affair as those who had quietly been backgrounding journalists sat in silence, as did Gillard, who must have worried that the bloody process of ousting Rudd wouldn't be worth the opportunity for Labor to regain the initiative without his unpopularity as the central issue.

When planes leave Canberra tomorrow night filled with Labor MPs and their staff returning to their electorates, Rudd is guaranteed to be Labor leader at the election later in the year. As one senior Labor figure told me, Rudd would sooner visit the Governor-General and call an election than let the caucus reconvene to challenge his leadership.

By not challenging, Gillard has chosen what appears to be the risk-free approach, but she must be nervous about Rudd's capacity to do what's necessary to retain Labor's slender nine-seat margin. If he can't and Labor is thrust back into opposition after one term, Rudd's name will be mud inside the wider labour movement. But Gillard also will find it difficult to retain her credibility. After all, she has been part of the gang of four and the Deputy Prime Minister who has spent more time as acting prime minister than anyone before her at the same point in a government's term.

History is written by the victors. The Gillard narrative so far is one of a fresh face with talent in spades: the first female prime minister-in-waiting. The opposition, stuck on the wrong side of the Treasury benches, has looked shrill when attacking her. Tony Abbott has managed to damage Rudd with his combative style of leadership, but when he squares off against Gillard each week on the Nine Network's early morning Today program, she usually gets the better of him. (Which is one of the reasons some MPs felt she was the circuit-breaker they needed and the person best able to beat Abbott at an election.)

If the Coalition wins the election, its barbs at Gillard will be more effective, such is the power of incumbency. And it will have three full years to tear her down (if she lasts that long).

She will be remembered as one of the architects of Medicare Gold under Mark Latham's leadership. One of the gang of four who agreed to delay the ETS and roll out the disastrous roof insulation program.

She will be remembered as the minister directly responsible for the overpriced Building the Education Revolution program in schools: the one that spent money the government didn't have, which has left the nation with a sizeable debt.

Rudd's style has been to exclude cabinet from the decision-making process, but as the Prime Minister's second-in-command Gillard has been part of that exclusion. Former ministers bitter at their salary cuts will remind colleagues of this as they lament their return to opposition.

Gillard would be the leader of a party disunited and looking for people to blame for the election loss. Rudd will wear most of it, to be sure, but there will be so much blame to go around, Gillard won't be able to escape all of it.

Most important, she will be seen as someone who could have saved the government if she'd had the courage to step up when her party needed her most.

While history suggests a Coalition win at the next election remains unlikely - no first-term government has lost an election since 1931 - there is one thing that is even less historically likely: an opposition leader who takes over the leadership after a government is defeated going on to become prime minister.

Let's hope for Gillard's sake that she can make history rather than succumb to it.